Apple, Still Lacking Friskiness

As the Apple Inc (AAPL) earnings parade has come and gone, it is time again to focus on the charts that are rather than what was, should be, or what analysts think will be.

Post the company’s earnings announcement on Tuesday, the analysis revisionists, also known as the sell-side analyst community, was busy taking their price targets down en masse.  A select few analysts, much to many a trader’s amusement, took their target prices down some 200 or more points…after the fact.  Perma bulls be perma bulls, and so it goes.  For my part however the charts will tell us more than enough to continually sniff out opportune spots for swing trades in either direction in the stock.  After all, if we can pick off 4% – 6% here and there in the stock, who needs to hang their hat on an analyst’s prediction that the stock will go to infinity and beyond by next Tuesday?

That’s that, I just had to shake those few sentences out my had…feels better already.  Now, to the charts we go.

The longer-term multi-year chart of Apple Inc (AAPL) remains equally unattractive as it did a couple of weeks ago.  As I discussed here ( on April 9th, eventually the stock had to dip below the $400 mark just to frighten those still too confident about their iPhone a tad more.

Should last week’s lows at $386 fail to hold, better lateral support sits around the $350 – $360 mark, which is the area of ultimate support that I am watching.

aapl multi year

The September 2012 down-trend remains firmly in place, yet the announced massive stock buyback program should act as some sort of put below the market.  At the same time we would be wise to remember that there still remain a plethora of both institutional and private investors who bought this stock north of $600, thus likely antsy to cut their losses on any meaningful bounce.  Combine these two factors and we have a stock that is potentially somewhat limited in both down and upside for the time being, which however should not keep swing traders from taking a few stabs here and there at juicy risk/reward points.

Closer up on the daily charts we are seeing more defined entry points to the long side.  With the exception of a couple of months, Apple Inc (AAPL) has been a trend follower’s dream stock…assuming one didn’t stay too stubbornly long last fall and switched to trending the stock lower.  The first downtrend line (lower red dotted line) briefly failed to hold as resistance in March.  Thus the down-trend resistance line I am now focusing on is the higher red dotted one on the chart below.  At the same time the 50 day simple moving average also acts as solid resistance since last September and more or less currently lines up with the upper red dotted line.

Very simply, until the down-trend line and 50 day simple moving average are broken to the upside, currently around the $430 mark, risk/reward on the long side remains subdued.

Patience is a virtue.

aapl daily






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